Tech Shares Decline As Apple Slumps; S&P 500 Touches 1,500 Level; Europe Rises On Upbeat PMI Data

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

The major market indexes mostly rose Thursday, with the Dow Jones gaining for a fifth day and the S&P 500 briefly topping the 1,500 mark as an unexpected drop in unemployment claims and upbeat corporate results offset the worst decline for Apple Inc in four years.

Apple Inc slumped 12 percent to $450.50 after reporting the weakest sales growth in 14 quarters even though earnings in the latest quarter climbed to a record $13.1 billion. The shares have shed 15 percent this year for the worst performance in the S&P 500, and have lost 36 percent since hitting an all-time high in September. The smartphone maker forecast sales of $41 to $43 billion in the fiscal second quarter underway now, compared with $45.5 billion in sales predicted by analysts.

Equities surged earlier today as a Labor Department report showed claims for unemployment benefits fell by 5,000 last week to 330,000, although the fact was ignored that data was incomplete due to 3 states not having reported yet, and their numbers were estimated. But nowadays, that does not matter as long as the market indexes have a reason, any reason, to close in the green.

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Tech Stocks Push US Equity ETFs Higher; Europe Rises Ahead Of US Debt Vote

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

US stocks closed higher Wednesday as technology stocks rallied amid upbeat earnings result and lawmakers voted to temporarily suspend the federal debt limit, helping the S&P 500 post its sixth straight day of gains that saw the benchmark index hitting a new five-year high.

Equities received support earlier after the Republican-controlled House of Representatives voted to suspend the $16.4 trillion debt limit until May 19. The vote averts a possible US default by at least four months and sets up the stage for another round of allegedly intense negotiations over cuts in federal programs.

A January 17 survey of Bloomberg showed global investors perceived the state of US finances the greatest threat to the world economy with nearly half holding back their investment decisions in response to budget battles. 36 percent respondents said US fiscal woes was the greatest risk compared with 29 percent who chose Europe’s sovereign debt crisis.

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7 ETF Model Portfolios You Can Use – Updated through 1/22/2013

Ulli Model ETF Portfolios Contact

The theme remained the same in that the indexes continued their relentless march into higher territory with the S&P 500 adding another 1.4% since last week’s ETF Model Portfolio report.

It’s almost impossible to find a pullback in the indexes intraday in order to establish new positions. On a couple of occasions, I had maybe 15 minutes to place some trades as the S&P 500 was slipping by a meager 4 points before the late day “lift-a-thon” kicked in and pushed the benchmark back to green, since in this centrally planned environment, a red close must be avoided at all costs.

Such is the world we’re living in and, while this bull market will not last forever, it could go on for a while. There is simply no way of knowing, but if you do participate in this rampage, let me be the voice of reason and suggest that you work with a trailing sell stop on all of your positions as any unforeseen event could derail this current trend in no time.

Here’s the latest update for our Model ETF Portfolios:

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The Relentless Equity March Continues; Europe Slips

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

US stocks gained Tuesday with the S&P 500 and the Dow finishing at fresh five-year highs amid better-than-expected quarterly results from corporations including insurer and Dow component Travelers Cos Inc.

Equity averages were briefly dented earlier, offering the only buying opportunity of the day, after a report from the National Association of Realtors showed US existing-home sales dipped one percent to a 4.94 million annual clip in December. The trade-group report followed a release from real-estate provider Zillow Inc., which showed US home prices rose 5.9 percent last year.

Meanwhile, House Republicans are set to vote Wednesday on raising the US debt limit through mid-May, a move the White House has welcomed ahead of the budget debate.

The Dow Jones Industrial Average (DJIA) zoomed 62 points to its highest level since December 10. The S&P 500 Index (SPX) rose 7 points to 1493 with materials and financial fronting the gains and consumer staples the sole laggard among its 10 business groups.

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ETFs/Mutual Funds On The Cutline – Updated Through 1/18/2013

Ulli ETFs on the Cutline Contact

ETFs/Mutual Funds On The Cutline – Updated Through 1/18/2013

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 398 ETFs, of which currently 373 (last week 363) of them are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher.

These ETFs are generated from my selected list of some 93 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 87 ETFs (last week 84) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 787 (last week 781) above the line and 72 below it out of the 859 that I follow.

Take a look:

1. ETF Master Cutline Report

2. ETF High Volume Cutline Report

3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

Last Week In Review: ETF News And Blog Posts To 1/20/2013

Ulli Market Review Contact

In case you missed it, here’s a summary of the ETF topics and market reviews I posted to my blog during the week ending on 1/20/2013.

Despite option expiration day last Friday, trading did not show much volatility for the first few days until the S&P 500 broke out to the upside and ended up gaining about 1% for the week.

The theme continued to be the same as intraday pullbacks were minor and afternoon lift-a-thons a given. We are now in a trading environment where it has almost become impossible to look for a pullback to add new positions as temporary ‘down periods’ last only minutes before the markets are being pushed up again.

Nothing goes up forever, and this market will not be an exception. We may very well be heading further into bubble territory, but reality has to to set in sooner or later.

If you are participating in this rally, be sure to have your exit strategy in place, because the exit doors will get crowded in a hurry once the rush starts. Again, while the timing of it is unknown, you need to be prepared.

Over past week, we covered the following:

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